(Corrects name of broker in headline and story.)
June 5 (Bloomberg) -- Petroleum Geo-Services ASA and TGS Nopec Geophysical ASA, Norway’s largest surveyors of underwater oil and gas fields, fell in Oslo trading as ABG Sundal Collier said energy producers will reduce spending as prices stagnate.
PGS slumped the most in more than five weeks while TGS dropped to the lowest intraday level since Jan. 8. ABG cut its oil price estimates through 2015, citing weaker economic growth in Europe and China and higher oil output from nations outside the Organization of Petroleum Exporting Countries.
“Seismic spending has historically been the most sensitive sector to changes in exploration and production spending,” the broker said in a report. “This time will be no different.”
Shares in seismic surveyors, which use ships to search for petroleum reserves under the seabed, have rallied the past year after oil producers operating off Africa, Norway and South America raised spending on exploration. Those gains are now at risk as oil prices fail to top $100 a barrel, squeezing profits.
ABG cut its oil price forecast for 2013 to $108 a barrel from $117, and reduced its estimate for 2014 to $115 from $125. For 2015, the broker expects crude to trade at $120 a barrel, down from a previous forecast of $125.
Growth in contract rates for seismic surveying will be 5 percent in 2014, ABG said, reducing its estimate from 10 percent. That means there’ll be no year-on-year increase in 2014 from the expected third-quarter level.
The broker also lowered its outlook for the multiclient market, where a surveyor builds a data library that’s then sold to explorers. Multiclient revenue forecasts were reduced by 3 percent to 6 percent, it said.
PGS, based in Lysaker, fell as much as 3.2 percent in Oslo and traded down 2.5 percent at 84.45 kroner as of 3:31 p.m. local time. TGS, based in Aker, dropped as much as 1.7 percent before paring its decline to 1.2 percent.
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